Adjusted EBITDA More Than Doubled
Adjusted EBITDA increased 125% year-over-year to $2.1 billion in Q1 2026, driven by record copper sales volumes, higher commodity prices and optimized feed at Trail.
Teck Resources
· TECK
April 23rd, 2026
Summary
- Earnings Call Date:
- 2026-04-23
- Change Since:
- -4.90%
- Next Earnings Date:
- 2026-07-23
Earnings Call Sentiment
PositiveThe call presented a markedly positive operational and financial picture: adjusted EBITDA and copper performance surged, cash generation and liquidity strengthened, major projects (Highland Valley MLE and QB TMF) progressed materially, and the Anglo merger is advancing. Key challenges include remaining TMF execution work and infrastructure timing, elevated zinc unit-cost guidance driven by lower zinc volumes, a large seasonal working-capital build, and macro cost risk from higher diesel/WTI. Despite these project and macro risks, management maintained guidance and highlighted strong near-term cash flow sensitivity to sustained high copper prices.
Company Guidance
Teck reiterated unchanged 2026 guidance and gave scenario-based outlooks: Q1 adjusted EBITDA was $2.1B (53% margin) and operating cash flow was $1.0B, and Management estimated full‑year EBITDA of ~$6.6B and operating cash of ~$5.5B if copper averages $5.50/lb for the rest of the year (rising to ~ $7.1B EBITDA and ~$5.9B operating cash if copper holds near $6.00/lb). Copper guidance remains 455,000–530,000 t in 2026 (Q1 copper production 140,000 t; QB Q1 production 56,000 t and sales 70,000 t) with net cash unit costs of $1.85–$2.20/lb (sensitivity: $10/oz silver = $0.02/lb; $10/bbl WTI = $0.03/lb; guidance assumes silver $36/oz and WTI $65/bbl). Highland Valley MLE capex is unchanged at $900–$1,200M for 2026 and $2.1–$2.4B total (Q1 spend $188M), targeting ~132,000 tpa copper and life to 2046; capitalized stripping guidance is $450–$500M. Zinc guidance remains 410,000–460,000 t in concentrate and 190,000–230,000 t refined with zinc net cash unit costs $0.65–$0.75/lb (Q1 zinc gross profit $387M; Trail gross profit before D&A $258M). Balance sheet metrics: net cash increased $338M in Q1 to $488M, additional $276M cash in April, and liquidity of $9.8B; dividend $0.50/share ($61M Q1). QB TMF milestones: Rock Bench 4 complete, Rock Bench 5 expected by end‑Q2, and steady‑state tailings operations targeted by year‑end.
Strong Cash Generation and Liquidity
Operating cash flow was $1.0 billion in Q1; net cash position increased $338 million to $488 million; additional $276 million generated in April; total available liquidity reported at $9.8 billion.
Record and Growing Copper Performance
Copper production rose 32% YoY to 140,000 tonnes; copper gross profit before D&A increased 158% YoY to $1.8 billion; copper gross profit margin before D&A improved to 52% from 47%.
QB Delivered Record Quarterly Copper Sales
QB produced 56,000 tonnes in Q1 and achieved record quarterly copper sales of 70,000 tonnes (drawing down inventory); mill availability was 92% and asset utilization 87% despite planned maintenance.
Trail Operations Profitability Recovery
Gross profit before D&A at Trail improved to $258 million in Q1 from $80 million in Q1 2025 (up ~222%), benefiting from optimized feed strategy and higher by-product prices.
Zinc Segment Improvement
Zinc gross profit before D&A increased 72% YoY to $387 million; refined zinc production at Trail rose by 16,000 tonnes; Red Dog zinc sales in the quarter were above guidance at 52,000 tonnes.
Unit Costs Declined
Net cash unit costs improved: copper net cash unit cost decreased by $0.27 US/lb YoY; zinc net cash unit cost decreased by $0.08 US/lb YoY, reflecting higher by-product credits and production.
Highland Valley Mine Life Extension Progress
Detailed engineering >90% complete and procurement >95% complete; $188 million invested in Q1; 2026 capex guidance for the project unchanged at $900M–$1.2B and total project cost unchanged at $2.1B–$2.4B.
TMF Progress at QB
Completed Rock Bench 4 in Q1; Rock Bench 5 expected by end of Q2; sand deposition rates improved after new cyclone installation; secondary sand cyclone approved to further improve sand quality.
Favourable Commodity Price Environment and Scenarios
Average copper price in Q1 was a record $5.83 US/lb. Management provided illustrative FY scenarios: at $5.50 US/lb copper EBITDA ~$6.6B and operating cash ~$5.5B; at ~$6 US/lb copper EBITDA ~$7.1B and operating cash ~$5.9B.
Safety Performance
High potential incident frequency rate of 0.05 in Q1, below 2025 annual rate of 0.06 (matching best-ever result).
Merger Progressing
Merger of equals with Anglo American received South Korea approval and regulatory review with China is proceeding normally; integration planning advancing and timeline unchanged at 12–18 months from announcement.
Operator
Ladies and gentlemen, thank you for standing by. Welcome to Teck Resources Limited's First Quarter 2026 Earnings Release Conference Call. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session. This conference call is being recorded on Thursday, 04/23/2026. I would now like to turn the conference over to Emma Chapman, Vice President, Investor. Please go ahead.
Emma Chapman
Thank you, Operator. Good morning, everyone, and thank you for joining us for Teck Resources Limited's first quarter 2026 conference call. Today's call contains forward-looking statements. Actual results may vary due to various risks and uncertainties. Teck Resources Limited does not assume the obligation to update any forward-looking statements. Please refer to Slide 2 for the assumptions underlying our forward-looking statements. We will reference non-GAAP measures throughout this presentation. Explanations and reconciliations are in our MD&A and the latest press release on our website.
On today's call, Jonathan Price, our CEO, will provide highlights for the first quarter 2026. Crystal Prystai, our CFO, will follow with further details on our operational performance and financials in the quarter. Jonathan will then wrap up with closing remarks and an opportunity for Q&A. And with that, over to you, Jonathan.
Jonathan Price
Thank you, Emma, and good morning, everyone. We will start with the highlights from the first quarter 2026 on Slide 4. We delivered a very strong start to the year with robust financial results reflecting both disciplined execution across our operations and t...
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